Black And Wood Pellet Market Global Report 2026

The black and wood pellet market size has grown rapidly in recent years. It will grow from $14.09 billion in 2025 to $15.52 billion in 2026 at a compound annual growth rate (CAGR) of 10.2%. The growth in the historic period can be attributed to rising demand for renewable solid fuels, increasing preference for alternatives to coal and other fossil fuels, growing utilization of wood residues for biomass energy, rising demand for biomass-based heating fuels, and increasing adoption of pellets in industrial energy applications.

The black and wood pellet market size is expected to see strong growth in the next few years. It will grow to $22.5 billion in 2030 at a compound annual growth rate (CAGR) of 9.7%. The growth in the forecast period can be attributed to rising demand for high-energy-density black pellets, increasing adoption of biomass co-firing in power generation, growing utilization of agricultural biomass for pellet production, expanding demand for renewable industrial heating fuels, and increasing deployment of combined heat and power systems using biomass pellets. Major trends in the forecast period include growing adoption of torrefied black pellets for high-density biomass fuel applications, rising demand for premium-grade wood pellets in residential heating, increasing utilization of forestry residues for pellet production, growing preference for combined heat and power generation using biomass pellets, and rising demand for standardized biomass pellets with consistent moisture and energy content.

The growing renewable energy demand is expected to propel the growth of the black and wood pellet market going forward. Renewable energy refers to energy produced from naturally replenishing resources, such as sunlight, wind, water, geothermal heat, and biomass, which are continuously replenished and generate little to no greenhouse gas emissions during operation. Growing renewable energy demand is primarily driven by increasing concerns about climate change, as governments, businesses, and consumers increasingly adopt low-carbon energy sources to reduce greenhouse gas emissions and achieve sustainability objectives. Growing renewable energy demand is driving the adoption of black and wood pellets as sustainable, low-carbon biomass fuels for electricity generation, heating, and industrial energy applications, supporting the transition away from fossil fuels. For instance, in January 2026, according to Ember, a UK-based independent energy think tank, France generated 539 TWh of clean electricity in 2025 and is targeting at least 91 GW of renewable energy capacity by 2030. Therefore, the growing renewable energy demand is driving the growth of the black and wood pellet market.

Key companies operating in the black and wood pellet market are focusing on expanding black pellet production capacity, such as advanced black pellet manufacturing facilities using steam-explosion technology, to increase the availability of renewable solid fuels, utilize low-value and wildfire-damaged biomass, and support the replacement of fossil fuels in energy and industrial applications. Steam-explosion-based black pellet production is a biomass conversion process that uses high-pressure steam to modify the structure of woody biomass, producing energy-dense pellets with improved handling, storage, and fuel characteristics compared with conventional biomass pellets. For example, in August 2026, Power Wood Holdings, a Canada-based biomass and renewable-energy company, and Chair Capital, a Canada-based investment firm, announced an investment of up to US$60.9 million (CA$84 million) to develop two advanced black pellet production facilities in Northern Alberta, Canada. The first facility, the Peace River plant near La Crête, and the second Hay Meadow facility near High Level are planned to use steam-explosion technology to produce black pellets from wildfire-damaged and deadwood biomass. The two facilities are expected to have a combined production capacity of approximately 700,000 tonnes of black pellets annually, supporting the utilization of damaged forest biomass while increasing the supply of renewable, energy-dense solid fuels.

In June 2025, PEARL Infrastructure Capital II SCA, a Luxembourg-based infrastructure investment firm, acquired a 65% stake in Arbaflame AS for an undisclosed amount. Through this acquisition, PEARL Infrastructure Capital aims to strengthen its sustainable infrastructure investment portfolio and accelerate the commercialization and expansion of advanced biomass fuel technologies designed to replace coal in industrial and power generation applications. Arbaflame AS is a Norway-based company that provides black wood pellets.

Major companies operating in the black and wood pellet market are Stora Enso Oyj, UPM-Kymmene Corporation, Drax Group plc, CM Biomass Partners A/S, Enviva Inc., Graanul Invest AS, Binderholz GmbH, Mayr-Melnhof Holz Holding AG, Pfeifer Holding GmbH, HASSLACHER Holding GmbH, Tolko Industries Ltd., AB Karl Hedin, Rettenmeier Holding AG, Verdo A/S, American Wood Fibers Inc., Holzwerke Weinzierl GmbH, Plospan BV, Donausäge Rumplmayr GmbH, Bauer Pellets GmbH, Energex American Inc., Premium Pellet Ltd., Airex Energy Inc., Bioendev AB.

North America was the dominant region in the black and wood pellet market in 2025. Asia-Pacific is expected to be the rapidly growing region in the forecast period. The regions covered in the black and wood pellet market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.

The countries covered in the black and wood pellet market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

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